NSW turned the House of Pain into their House of Joy and kept their Super 12 rugby semi-final hopes alive with a dramatic 27-23 win over the Highlanders in Dunedin.

A 76th minute try to recalled five-eighth Duncan McRae secured a precious bonus point victory which moved the Waratahs to within one point of the Highlanders, who started the penultimate round in fourth position.

NSW scored four tries to one as they collected only their second victory in the last six rounds.

The Highlanders enjoyed a massive 14-6 advantage in the penalty count and also had the majority of territory and possession.

It was among the best NSW performances in Dwyer's three-year tenure, especially as few teams had won at Carisbrook in recent years.

"We played excellently against the Crusaders this season and last season we played some great footy against the Highlanders and the Brumbies in Sydney, but to come here and win is a big effort," Dwyer said.

"To score four tries to one when we were behind in the possession stakes and behind on the penalty count was a super effort."

NSW had the third worst defensive record in the tournament heading into this round, but displayed greater intensity to limit the Highlanders to just one five-pointer.

"So many times during the year we were letting teams just do their stuff and not putting pressure on them, like a training run. Tonight we decided to up the ante just a fraction and got some results," NSW captain and fullback Matt Burke said.

The Highlanders' back line lacked the penetration of the Waratahs, who were well served by the incisive centre pairing of Gray and Morgan Turinui and wingers Thaiday and Lote Tuqiri.

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